Water-energy nexus: Untying the Gordian knot

The relationship between water and energy is close and fraught with misunderstandings. The European Union has only dipped its toe into the subject, starting with a recent proposal to update the bloc’s drinking water directive. EURACTIV takes a look at the key issues.

Background

On 1 February, the European Commission unveiled its proposal on updating drinking water rules, with an aim to improve human health, reduce emissions and tackle plastic pollution.

Water quality and health are the marquee objectives of the update, as new emerging substances have been added to a list of safety criteria. Authorities dealing with water treatment will only have to treat substances that are common in their area, rather than deal with a long list of generic substances.

But the proposal’s quest for transparency is also intended to improve the energy performance of the water sector and losses caused by flawed infrastructure. Both issues have only played a supporting role in European water policies to date.

Members of the European Parliament's environment committee will now be tasked with proposing amendments to the Commission's proposal. French MEP Michel Dantin, from the centre-right European Peoples' Party (EPP) was recently named lead rapporteur on the file and will now submit a draft report.

Issues

ENERGY CONSUMPTION

In 2016, the International Energy Agency produced a landmark study on the relationship between water and energy. The Water Energy Nexus excerpt of its World Energy Outlook highlights the close link between the two, warning that "almost all the weaknesses in the global energy system, whether related to energy access, energy security or the response to climate change, can be exacerbated by changes in water availability".

The numbers involved are significant. The IEA estimates that the EU water sector’s annual energy consumption is equal to 3.5% of the bloc’s yearly electricity demand.

It is a vicious circle of sorts: energy is needed to deliver and treat water, while water is needed to produce energy, be it through cooling power plants or cleaning solar panels to preserve efficiency.

At the moment, 10% of global water withdrawals are currently related to energy, mainly for power plant operation as well as for production of fossil fuels and biofuels, the IEA said. And the inter-dependence between the two is only set to intensify in the coming years, as the water needs of the energy sector rise.

There have been notable developments in recent years to cut the energy sector's reliance on water. For example, China's newly-opened Three Gorges floating solar plant, symbolically located on top of an old coal mine, is the largest in the world and uses the water it is installed upon to clean its panels.

Increased prevalence of wind farms also means water is needed less than for installations like thermal power plants. Low capacity wind turbines can be cooled by the air alone, while larger models utilise forced air cooling in conjunction with liquid cooling systems.

But those measures only scrape the surface, as a plethora of other water-intensive processes like biofuel cultivation and other forms of electricity generation mean water consumption in the sector could increase 60% by 2040, according to the International Energy Agency.

Its analysis points out that depending on the type of low-carbon pathway chosen by the world's economies, the energy-water relationship could in fact be strained further. For example, increased use of nuclear power and carbon-capture-and-storage will likely increase water use.

THE CONSUMER SIDE

On the other side of the equation is the energy used to supply water to consumers – whether for drinking or sanitation purposes.

And here too, global demand is set to grow as urbanisation continues unabated. In 2014 some 4% of global electricity consumption was used to extract, distribute and treat water and wastewater for use by end consumers. An additional 50 million tonnes of oil equivalent were used for irrigation pumps and desalination plants, mostly in the form of diesel.

Those amounts are projected to more than double by 2040, with the largest increase coming from desalination, large-scale water transfers and increasing demand for wastewater treatment.

At a local level, water and wastewater facilities are a huge drain on finances and often have the biggest electricity needs. Power charges make up between 30 and 50% of municipalities’ bills, which are easily passed on to consumers who usually have no alternative suppliers.

The IEA reckons that the largest savings potential lie in wastewater treatment, desalination and supply.

In fact, some municipalities in the EU and US have shown that improving energy efficiency and recovering energy from their own processes can move their operations towards ‘energy neutrality’, where energy needs are entirely satisfied with own generation.

There are notable examples of local authorities implementing measures that have cut energy consumption drastically. The poster child for this new way of thinking is the Danish city of Aarhus, which wants to make its water sector energy neutral by the turn of the decade. Copenhagen is also notable for reducing water consumption by 42% since 1985.

Reflecting a fundamental change in approach, Danish authorities are now no longer referring to wastewater but to “resource water” instead. As a result, the Danish water sector only uses 1.8% of the nation’s total energy consumption.

And the technologies are there to make the sector energy neutral “right now”, officials say. The city of Aarhus, for instance, wants to make the water cycle energy neutral by 2020.

Thanks to determined policies, Denmark has succeeded in breaking the seemingly inextricable linkage between water and energy use. But replicating the Danish model at European level won’t be easy, policymakers warn.

PRICING AND TRANSPARENCY ARE KEY

Danish officials say water pricing with “full cost recovery” was a key driver behind the Danish success story. The water price in Denmark now includes the entire water cycle, including investments in new technology. And a penalty tax on water utilities was introduced as an incentive for water utilities to stay below a 10% leakage mark.

To sceptics who argue these are big investments, Danes respond that costs can be recovered in just a few years. And the savings from lower energy consumption can then be passed on to consumers, who can expect to benefit from lower prices.

But that requires basic transparency in the way pricing is done by water utilities. At European level, Annex 4 of the Commission's proposed revision of the drinking water directive calls on water utilities to be more transparent in their bills. Consumers should also be able to check information on factors like energy consumption.

This is seen as a ground-breaking provision that could theoretically bring down water prices as utilities would have a harder time justifying prices if they are based on poor infrastructure. It should also add pressure on utilities to invest more money in better pipes and treatment facilities.

But there are already concerns that the EU executive's proposal does not go far enough, as consumers and local authorities might struggle to compare the detail of their bills. In order for the system to be effective, mayors should be able to compare the energy performance of their water suppliers – from extraction to tap delivery – and hold them to account, critics say.

If the information is not comparable, water utilities will remain in a position to game the system in a market where there is little competition and consumers are captive. And mayors won't be able to hold utilities to account.

It will be up to MEPs to decide whether to make those transparency requirements Annex 4 sufficiently detailed.

Investing in updated and improved infrastructure should create a circular economy of sorts, where financial losses are reduced hand-in-hand by plugging leaks and the resulting saved capital can be reinvested in improving water systems even further.

Some member states already penalise companies that exceed set leakage rates and this has been touted as a potential measure that could be rolled out across the EU. Denmark, again, is among the most progressive in the sector, as it has a 10% leakage rate target in place.

Utilities that exceed that target must pay a penalty. Since 1996, all properties connected to the public water network must install water meters, which gives the relevant authorities all the data needed to identify where leaks are. Water loss in Denmark only reaches an average of 7.8%.

One of the more obvious ramifications of a leaky drinking water network is contamination and the risk to human health. Pipes with holes in them not only let water out but let foreign bodies in. Essentially, the more robust the infrastructure, the less likely our water will be polluted.

A World Health Organisation study pointed out that leakages occur more often when water pressure is lower. Higher water pressure needs more energy to achieve, illustrating the link between energy use, resource efficiency and human health.

But water quality, unlike air quality, is an area in which the Commission rarely has to chase the member states. EU Environment Commissioner Karmenu Vella admitted at the launch of the proposal that national capitals often implement bloc rules sufficiently.

Cutting energy and water bills are not the only benefits of a more robust system. The Cape Town water crisis is a perfect demonstrator of how changing weather patterns and climate can push a city to the very brink of full-scale crisis.

A severe drought pushed the city's administrators to estimate that taps would have to be turned off in April of this year, a date that was ominously dubbed 'Day Zero'. But thanks to stringent water usage restrictions, the cut-off point has been pushed back until next year.

A limit of 50 litres of water a day has been in place for over a year and the city has even published a map of households that exceed the limit, in an effort to shame residents into reducing their consumption.

GROWING NEEDS

Growth across the globe, particularly in developing countries means that both energy and water needs will increase. Industrial processes and agriculture will need more and more H2O for cooling and crop cultivation.

This growth will lead to higher levels of wastewater as well that must be collected and treated, and will require that water supply is available when and where it is needed. That collection and treatment will need more energy but that is where better technology and energy efficiency schemes come into play.

Positions

The International Energy Agency predicts a shift towards more water-intensive energy and energy-intensive water over the next 25 yeas. The challenge will be especially acute in developing countries where energy demand is rising fastest to supply industry, power generation and households, including those getting access to reliable clean water and sanitation for the first time.

But it also said options are available to avoid potential stress points. This can be done by integrating energy and water policies and infrastructure, tapping the energy embedded in wastewater, improving the efficiency of the water and energy sector, and using alternative water sources in the energy sector.

"For example, building new wastewater capacity that capitalises on energy efficiency and energy recovery" could help temper the associated rise in energy demand from providing sanitation for all and reducing the amount of untreated wastewater, the IEA said in a recent commentary. In fact, "utilising the energy embedded in wastewater alone can meet more than half of the electricity required at a wastewater treatment plant," it said.

Mads Warming, Global Director for Water & Waste Water at Danfoss, said, "the Aarhus case is replicable to existing facilities throughout Europe. The EU water policy should support cities in exploring opportunities in the water sector, starting with the recast of the DWD.

"The EU’s new Drinking Water Directive could be a first step towards an energy neutral water sector and a sustainable drinking water supply management. Indeed, in the new DWD, the European Commission proposed more transparency on energy performance and water leakage rates. This should be kept throughout the legislative procedure.

"Citizens should know about their supplier’s energy use and water losses. Both is equally important for the quality of the drinking water and for limiting contamination. However, there is room for being more ambitious. We can turn the water sector energy neutral and at the same time obtain very low leakage, protecting our precious water resources.”

EURACTIV put the following questions to IEA expert Molly Walton:

How does the WEO relate particularly to Europe's relationship with water and energy, are there any Euro-specific peculiarities that aren't found elsewhere?

In many ways, Europe is at the forefront of many of the discussions on water and energy, in particular in regards to wastewater management. Roughly 45% of electricity needs in the water sector in the EU are for wastewater treatment. The next closest energy user is distribution at over 20%. However, this can be lowered. Pioneering efforts, led by some municipalities in the EU, have shown that improving energy efficiency and harnessing the energy embedded in wastewater can help meet some of the sector’s energy needs. Some wastewater utilities have capitalized on these opportunities to become energy neutral or are producing excess energy for other uses.

The report mentions that increased use of renewable energies like solar could impact the water system. Does that mean RES uptake should be curtailed to allow water infrastructure to catch up?

No. Not all technologies and fuels have the same water needs. Some low-carbon technologies, such as wind and solar PV, require very little water, but IEA analysis found that the more a decarbonisation pathway relies on nuclear, biofuels, CCS and CSP, the more water it consumes. As such, efforts to tackle climate change may exacerbate water stress in some cases, or be limited by water availability depending on the fuel and technology mix and local water availability. This is yet another example of why it is so important to integrate energy and water policymaking.

Improving energy efficiency in the water sector is mentioned by the report. Do you think EU laws, either current or pending, do enough to tap into that potential? Where could more be done?

Of course, any policies and efforts to increase the availability of water and treat it to higher levels can require additional energy. However, IEA analysis found that there were many potential opportunities to lower the energy needs of the water sector in the EU. For starters, water losses in public supply in the EU as a whole are roughly 24%, this entails not only a loss of water but also a loss of energy. If the EU was able to reduce water losses to 6%, it could save around 8 TWh of electricity today.

In water supply the use of more efficient and correctly sized pumps, variable speed drives and predictive maintenance can lower electricity needs. Given that the wastewater treatment sector accounts for 45% of the water sectors’ electricity consumption in the EU, this is another area where significant savings can be achieved. Our analysis found that capitalizing on energy recovery potential could provide around 60% of the electricity required for municipal wastewater treatment in the EU by 2040. However, as some individual utilities have shown, it is possible to reach 100% and more, which, under the right policies and incentive schemes, could be replicated at other utilities.

Timeline

1 February European Commission unveils proposal for a recast of the Drinking Water Directive

EU Council Joint position (so-called general approach) pending. Current Bulgarian Presidency of the EU may start negotiations but no ambition to finalise

Trilateral talks European Parliament, Commission and member state negotiators will meet once all three have finalised their positions. Possibility that legislation will be adopted by end of year or at beginning of 2019